September 13, 2012

A Longshoreman’s Strike; How Concerned Should the Toy Industry Be?

The TIA is monitoring a potential strike by East and Gulf
Coast Longshoremen. The strike, if
negotiations fail, would begin October 1.

The TIA is doing a good job by monitoring the situation. It would seem, however, unlikely that most
toy industry members would be affected. The
great percentages of toys, as we all know, are manufactured in China. Those goods generally arrive through the west
coast ports and particularly the Port of Long Beach, California.

East coast companies who import from China tend to take
their goods into Long Beach as well.
Why, because the Panama Canal is too small for the largest container
ships and it’s a long way around the tip of South America. So it is quicker to ship them overland once
they hit the west coast. Those companies
who do pull in through the east coast ports should be able to reroute through
the west coast.

Who should be concerned are those retailers who sell toys
that are made in Europe or South and Central America. They are a minority of toy imports but a long
strike could cause them a great deal of pain.

Comments

According to one freight forwarder: "If all East Coast cargo starts to come into the West Coast, those ports will be slammed and the inland transportation costs would go up dramatically... At this point anything can happen. The West Coast ports are already almost at max capacity because major retailers are already bringing their East Coast cargo in thru the West Coast to make sure their products are on shelves for the holiday season. The East Coast is wide open and rates have actually dropped significantly to those ports." The dispute may be settled before any damage is done. But, there is still time for products like board games to be MADE IN THE USA to cover any potential shortfall due to port delays.